Single-Aisles Lead $4 Trillion Charge

Boeing’s latest 20 year forecast highlights the big role that single-aisle orders are playing in the international aircraft market thanks to higher fuel prices, airline liberalization and the huge growth in the Asia-Pacific market.

In its annual 20-year forecast released Thursday, Boeing predicted demand for 33,500 deliveries of passenger and freighter aircraft larger than 90 seats carrying a value that tops $4 trillion for the first time. The prediction represents a big jump from last year’s expectation of a $3.6 trillion market based on 30,900 aircraft sales.

The latest expectation is that passenger traffic growth will average 5.1% through 2030. Global passenger growth will climb from 4.9 trillion revenue passenger kilometers currently to 13 trillion RPKs in 2030.

“We’re at the beginning of an up cycle,” explains chief forecaster Vice President Randy Tinseth. Economic growth, world trade and airline liberalization “all point to a healthy long-term demand,” he says..

Single-aisle transports always have been the industry’s workhorses, but advantageous pilot scope clauses and a variety of new offerings helped propel small regional jet sales early in the last decade. As carriers opened new feeder routes, demand fell slightly for traditional narrowbody transports.

However, escalating fuel prices and a general trend toward larger jets dimmed the prospects for the smaller jets as more fuel-efficient turboprops regained that segment of the market. Larger regional jets, 90-110 seats, have held ground but the main growth in single-aisles is in the 145-180 seat range, where Airbus and Boeing are concentrating their sales.

As the locus of the industry’s growth has shifted from North America and Europe to Asia, single-aisles have moved with it. In 2010, the Asia-Pacific mega-region became the world’s biggest airline market. Baring a catastrophic event, Tinseth says he expects it to retain that crown as far ahead as anyone can forecast.

In its forecast, Boeing says Asia-Pacific will have demand for 11,450 total airplanes through 2030, either as replacements or to expand existing fleets.

Following in order of the size of their markets are Europe with 7,550 total aircraft; North America, 7,530; Latin America, 2,570; the Middle East, 2,520, the former Commonwealth of Independent States, 1,080 and Africa, 800.

Within Asia, China is the top market with a projected annual growth rate of 7%. Its greatest demand is for 100-200-seat single-aisle jets.

Although the once mighty North American market segment has lost its first-place luster, it represents the biggest opportunity for replacement aircraft sales, largely because there are so many 20-plus year old, fuel hungry single-aisles still in service.

As a percentage of a national fleet, however, it is Russia that will see the biggest turnover in the coming decades, Tinseth says.

Boeing looked at hundreds of airports served by low cost carriers in developing countries in an effort to understand what those markets will look like in 2030. Its conclusion is that a lot of smaller airplanes will simply be pushed out by the growth of single aisles.

Despite an emerging threat to the Airbus-Boeing manufacturing duopoly, the impact of new entrants by Bombardier’s CSeries, Comac’s C919 and Irkut’s MS-21 families will not be felt until the latter years of the new forecasting period. “This is a market big enough for [both] of us to grow,” Tinseth says of Boeing and Airbus.

By the end of 2030, Boeing expects 39,530 commercial jets to be operating, but only 6,030 of those in service today will be among them. The 33,500 coming into the market includes 40%, or 13,380 airplanes, as replacements and 60%, 20,120, for fleet growth.

Freighter orders will grow at a 5.6% and be worth $250 billion. The greatest demand will be in long-range freighters. Total demand will be 3,000 aircraft, 970 of them new, the rest converted from passenger aircraft. The world freighter fleet will double in the period.

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